Ark Invest sees Tesla shares at $3,000 by 2025

Tesla shares surged on Monday after tech-focused investment manager Ark Invest said the price could hit $3,000 by 2025 in its base case scenario.

According to a research note published late on Friday, analyst Tasha Keeney set a 2025 bear case price target on the shares of $1,500 and a bull case target of $4,000.

Last year, Ark estimated that in 2024, Tesla’s share price would hit $7,000 per share, or $1,400 adjusted for its five-for-one stock split.

In its last valuation model, Ark assumed Tesla had a 30% chance of delivering fully autonomous driving in the five years ended 2024. However, it now estimates the probability is 50% by 2025.

"Since our last forecast, neural networks have solved many complex problems previously considered unsolvable, increasing the probability that robotaxis are viable," it said.

Ark estimates that Tesla’s vehicle fleet gives it access to 30-40 million miles of data per day, up from 20m per day last year. "If successful, Tesla could scale its robotaxi service rapidly, allocating the additional cash in turn to manufacturing capacity serving its autonomous network," said Keeney.

"If 60% of its vehicles equipped with Autopilot were to serve as robotaxis, Tesla could generate an additional $160 billion in EBITDA in 2025. In our bull case, ride-hail would account for the majority of Tesla’s enterprise value in 2025."

At 1455 GMT, Tesla shares were up 4.6% at $685.01.